The setting up of ELWa, the body that funds post-16 education and training outside higher education, was an opportunity to bring about greater coherence in the funding and planning of further education colleges, school sixth-forms, private training providers and voluntary bodies.

fforwm recognises that the distinct legal status of these institutions means there will always be some differences in approach and in audit and regulation requirements.

The issue is whether these institutions are completely separate or just need to be treated differently. Are we akin to different fruit - apples, pears and lemons - or are we just different varieties of the same fruit - Golden Delicious, Cox’s Pippin and Gala?

For example, there are at present three broad funding models in post-16 education and lifelong learning: the recurrent funding methodology for FE institutions; a contractual model used for training providers (colleges deliver probably about one-third of these contracts); and a formula linked to full-time student numbers and retention for school sixth-forms.

To replace these three models, ELWa is introducing its much-vaunted national planning and funding system (NPFS) from August 1, to be phased in over a five-year period to protect institutions’ financial health.

fforwm supports the principle of the NPFS, although colleges are anxiously waiting to see the full impact of changes made to the initial draft allocations. The development of a fair, equitable and responsive funding system for the post-16 education and lifelong learning sector will play a crucial part in determining the educational and business approach of colleges and other providers.

The funding system must therefore reflect the policy requirements of the Welsh Assembly government on lifelong learning, widening participation, improving quality, tackling the skills deficit and raising economic performance in Wales. But the introduction of the NPFS is but one step towards a level playing field in post-16 education in Wales.

There are other issues that need urgently to be addressed. Colleges pay VAT, schools do not. A fforwm survey has calculated that FE colleges pay an average of pound;9.4 million per year - about 4 per cent of their total income.

Colleges have to complete far more complex and detailed data returns (the lifelong learning Wales record) than schools (the post-16 pupil level annual school census).

A major concern is that, because of the use of these two contrasting systems, the performance of colleges and schools cannot accurately be compared.

Definitions of student retention and achievement differ. In colleges there are three census dates when student numbers are collected - November, February and May. Students not attending for a certain period by these dates are deemed to have left.

In schools there is one census date. Achievement rates are not the same. Is success measured as a proportion of those starting a course or those who actually sit an examination? These and other distinctions are vital in understanding and benchmarking performance data.

ELWa is currently developing a quality provider performance review for colleges and work-based learning providers. Schools and local education authorities are not included.

Up to now, inspection arrangements have been different for schools and colleges. The extension of a common inspection framework across post-16 education, with increased focus on self-assessment, will enable results of inspections to be compared across institutions.

But Estyn contracts out inspections of schools while retaining its own inspectorate for the inspection of colleges and training providers.

There are other differences. Colleges are expected to submit annual and detailed operational and institutional plans with complex annexes covering estate, marketing, bilingualism and finance.

Colleges have to supply ELWa with a substantial amount of financial information, such as five-year forecasts, mid-year returns, finance records (year end) and financial statements.

Other providers do not have to do this level of planning. The rules for adaptation of buildings under the Disability Discrimination Act are different for colleges than for schools and are more onerous and costly.

Colleges also make provision for transport out of their own funds. They are also subject to different and stricter audit arrangements than schools and training providers.

fforwm has identified 43 separate audit and inspection arrangements that affect colleges in Wales, including internal and external audits. These are out of all proportion to risk, and place costly demands on their staff. I could go on.

Almost four years after the setting up of ELWa, we still have three distinct sectors treated as different fruit.

The introduction of the NPFS is a first major step in bringing about real equity of funding and a common approach at post-16 level - and treating institutions as varieties of the same fruit.

John Graystone is chief executive of fforwm